IFRS for SMEs-U.S. GAAP Comparison Tool Available Online

While
the SEC moves toward a 2011 vote on whether to require U.S. public
companies to report using IFRS, a more compact version of the
international standards is already an option, subject to state board
approval, for U.S. private companies. Now there’s a free online tool
to help preparers
understand how that streamlined standard compares to U.S. GAAP.

The
IFRS for SMEs-U.S. GAAP Comparison Wiki, available at wiki.ifrs.com, is a collaborative
resource launched in January for understanding differences between
the two sets of financial reporting standards. IFRS for SMEs is a
simplified version of full IFRS aimed at meeting the needs of
private company financial reporting users. It eliminates some of the
requirements meant specifically for public entities.

The
wiki was designed to provide a comprehensive and detailed comparison
of IFRS for SMEs to U.S. GAAP. Previously, only high-level
comparisons were available, according to Robert Durak, a senior
technical adviser for the AICPA. When fully developed, it will
include comparisons of all sections of IFRS for SMEs and will be
updated as new standards emerge. It was created by the AICPA
Accounting Standards team and can be updated and edited by anyone in
the profession.

Each
section of the wiki is presented as a three-column table. The first
column specifies the IFRS for SMEs paragraph number; the second
column presents what the IFRS for SMEs requirement is; and the third
column presents the AICPA staff’s views on how corresponding
requirements in U.S. GAAP compare.

For
example, under the “Total comprehensive income and profit or loss”
section 2.45 of the “Concepts and Pervasive Principles” content
area, the IFRS for SMEs column explains this IFRS “does not allow
the recognition of items in the statement of financial position that
do not meet the definition of assets or of liabilities regardless of
whether they result from applying the notion commonly referred to as
the ‘matching concept’ for measuring profit or loss.”

The
U.S. GAAP column explains the difference: Concepts are the same. But
the current authoritative literature permits recognition as assets
of some items that do not meet the definition of an asset, such as
debt issue costs.

That
third column is where the wiki part comes in. Wikis are Web sites
that can be edited on an ongoing basis by knowledge experts in the
community they serve. In this case, users can improve the
descriptions of corresponding U.S. GAAP and how GAAP differs from
IFRS for SMEs. These improvements can take the form of additions,
clarifications, or fixes to incorrect content.

Using
a wiki platform should speed the buildout of the comparison tool and
boost the quality by “expanding the development effort beyond the
staff of the AICPA,” Durak said. “By using the wiki platform, the
AICPA can tap into the vast reservoir of accounting knowledge within
the profession and collaboratively develop this tool with our
members and others who choose to participate.”

This
is the first AICPA wiki, but the Institute may introduce others
following the launch of the new aicpa.orgWeb site.

HOW TO CONTRIBUTE

Anyone
preparing or thinking of preparing financial statements under IFRS
for SMEs in the U.S. or interested in the differences between the
standards and U.S. GAAP is a potential user and contributor. There
is no requirement to be a CPA or an AICPA member.

Registration
is only required to make edits or comments, not to use the wiki as a resource.

Users
are limited to editing the content contained in the U.S. GAAP
column. A tutorial of a few sentences located on the wiki site
explains how the process works.

Edits
will be anonymous—the user’s name will not be listed, though site
administrators will know who made them. AICPA technical staff will
monitor and review contributions to the wiki for accuracy. If they
identify edits as inaccurate or of poor quality, they will reverse
or correct them. They can temporarily or permanently ban editors who
consistently post changes or additions that are inaccurate or
inconsistent with its purpose.